The United States finds itself in a precarious position, one that demands urgent attention from every citizen. Many will dismiss this warning outright. They will say they have heard such alarms for years, that nothing catastrophic has ever befallen the United States, the greatest nation on earth. We ignore the alarm at our peril.
Our stature was earned through the wisdom of our Founding Fathers and the sound policies that followed. We can point out that the U.S. dollar remains the world’s reserve currency, granting us unique privileges.
That is true, but only for now. The dollar holds that status because the global financial system still trusts the United States. No viable alternative exists.
This confidence was hard-won over decades, yet it is being squandered through recent reckless fiscal behavior. When global confidence finally evaporates, and it will if we persist on our current path, the consequences will mirror those faced by nations such as Venezuela and Zimbabwe.
Who will bail out the United States if it falls? No one. We are not too big to fail; rather, we are too big to save.
History offers sobering lessons. No great nation has endured forever. I am reminded of the words of Alexander Tytler, the Scottish historian and judge, who observed more than 250 years ago: “A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury, with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship.”
Our national debt, combined with unfunded obligations, now exceeds $130 trillion. Projections show multi-trillion-dollar deficits stretching into the indefinite future.
Our debt is a giant Ponzi scheme. The United States is technically insolvent. We lack the earnings to service our obligations as they mature, so we borrow anew to pay off old debts while adding even more debt to fund our massive annual shortfalls.
As long as willing lenders exist, the scheme persists, and we can continue to operate. Last year alone, we borrowed $10 trillion in new debt: about $8 trillion to roll over maturing obligations and $2 trillion to cover the deficit. When borrowing dries up, the scheme collapses.
We have received repeated warnings. Credit rating agencies have downgraded our debt. Experts, scholars and market signals have sounded the alarm. Even the government states clearly that the fiscal path is unsustainable. Yet, these cautions go largely unheeded.
If we rely on elected representatives to solve this crisis, we will wait in vain. Their focus remains fixed on the next election and what it will take to secure votes. That dynamic places responsibility squarely on us, the voting public.
We must recognize the reality of our situation and demand fiscal sanity from those who represent us. We have the power to choose differently, to prioritize long-term stewardship over short-term gratification.
Let us rise to the challenge before the window closes forever.
Les Rubin is the founder and president of Main Street Economics/InsideSources.com
